Mornington Peninsula Shire, VIC

The Shire of Mornington Peninsula is a local government area in Victoria located in southern Metropolitan Melbourne. The LGA has become one of Victoria’s most popular real estate locations and attracts buyers for its natural features and proximity to the state capital.

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The peninsula offers beautiful coastline scenery and various tourist attractions. It has everything from sprawling vineyards to sandy beaches. Tourism makes it an ideal place for those who want to live near the sea without having to deal with suburban inconveniences, such as high prices of living or traffic jams.

In recent years there has been a rise in house prices in this region due to the demand of new residents seeking country living close to Melbourne’s amenities.

Professionals (18.8%), Technicians and Trades Workers (17.7%), Managers (14.1%), Clerical and Administrative Workers (12.0%), and Community and Personal Service Workers (11.8%) are the most frequent jobs in Mornington Peninsula. The Mornington Peninsula’s typical weekly personal income for persons aged 15 years and older is $630, which is above the state average.

On the Mornington Peninsula, 84.2 % of occupied private residences are single detached houses, 10.0 % are semi-detached, row or terrace houses, townhouses, etc., 4.7 % are flats or apartments, and 0.8 % are other dwellings.

There are many factors which impact the Mornington Peninsula property market. The location of the property, its size, its condition, and what is nearby are some factors that affect the local property market.

Discover price trends for sales and rentals in Mornington with the help of the interactive dashboard on this page.

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Capital Growth Heatmap

Property Market Snapshot

This page provides an overview of the LGA real estate market. The data in this snapshot illustrates typical price, median rent and gross yield metrics for this council area. You are able to drill down to suburb-level data and charts which visualise these 3 key metrics as well as other important indicators in the dashboard section that follows.

Buy 

2BR

3BR

4BR

5BR

Typical Price for houses in this council area. Percent changes indicate Year on Year growth or decline in house values. Council area house prices are calculated by averaging Typical Price of all suburbs within the area. Typical Price is a more accurate metric than Median Price.

Rent 

2BR

3BR

4BR

5BR

Median Weekly Rent for houses in this council area. Percent changes indicate Year on Year growth or decline in rental prices. Calculated via median value formula applied to rental prices from online listings.

Yield 

2BR

3BR

4BR

5BR

Yearly Gross Yield for houses in this council area. Calculated by multiplying the Median Rent by 52 and dividing the resulting value by Typical Price. Percent changes indicate Year on Year growth or decline in Gross Yield for houses.

Buy 

1BR

2BR

3BR

Typical Price for units in this council area. Percent changes indicate Year on Year growth or decline in unit values. Council area house prices are calculated by averaging Typical Price of all suburbs within the area. Typical Price is a more accurate metric than Median Price.

Rent 

1BR

2BR

3BR

Median Weekly Rent for units in this council area. Percent changes indicate Year on Year growth or decline in rental prices. Calculated via median value formula applied to rental prices from online listings.

Yield 

1BR

2BR

3BR

Yearly Gross Yield for units in this council area. Calculated by multiplying the Median Rent by 52 and dividing the resulting value by Typical Price. Percent changes indicate Year on Year growth or decline in Gross Yield for units.

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Property Market in Mornington Peninsula Shire, VIC

What other property markets are there near Mornington Peninsula Shire, VIC?

Mornington Peninsula Shire is surrounded by 2 other council areas – Frankston, Casey.

Suburbs/localities in this Local Government Area: Hastings 3915, Hmas Cerberus 3920, Balnarring 3926, Balnarring Beach 3926, Main Ridge 3928, Mccrae 3938, Merricks 3916, Merricks Beach 3926, Merricks North 3926, Baxter 3911, Moorooduc 3933, Mornington 3931, Mount Eliza 3930, Mount Martha 3934, Pearcedale 3912, Point Leo 3916, Portsea 3944, Red Hill 3937, Red Hill South 3937, Rosebud 3939, Rye 3941, Safety Beach 3936, Shoreham 3916, Somers 3927, Somerville 3912, Sorrento 3943, St Andrews Beach 3941, Bittern 3918, Tootgarook 3941, Blairgowrie 3942, Tuerong 3915, Tyabb 3913, Boneo 3939, Capel Sound 3940, Cape Schanck 3939, Crib Point 3919, Arthurs Seat 3936, Dromana 3936, Fingal 3939, Flinders 3929

2 thoughts on “Mornington Peninsula Shire, VIC”

  1. Housing Market Outlook for Mornington Peninsula Shire

    The local government area (LGA) of Mornington Peninsula Shire juts out between Port Phillip Bay and Western Port Bay to the south of Melbourne. The environment ranges from the commuter towns of Mornington and Mount Eliza, to country locations such as Red Hill and the vacation spots of Dromana and Tootgarook. Mornington Peninsula Property Market outlook is generally a good one because the area is a desirable location filled with high-value homes.

    Property Market Outlook for Mornington and Neighbouring LGAs

    The property market in Melbourne hasn’t been doing very well recently and the gravitational pull of the state’s capital has dragged nearby property markets down, too. Only LGAs away from Melbourne, such as Greater Geelong City, Surf Coast Shire, Bass Coast Shire, and South Gippsland Shire have managed to experience property price rises.

    The Melbourne urban area has a similar profile to that of Sydney. The local property market overheated during the economic boom years and now those prices are correcting. Being a desirable location within the sphere of Melbourne, Mornington Peninsula Shire follows the same pattern.

    Mornigton Peninsula Capital Growth Heatmap for houses

    House prices in Mornington Peninsula Shire fell by 1.71 percent in the 4th quarter of 2019 (compared to Q4 2018). Price drops become more pronounced in LGAs that are progressively closer to the centre of Melbourne. Frankston City, just to the north of Mornington Peninsula Shire saw house prices fall by 2.2 percent. To the north of Frankston City, Kingston City and Greater Dandenong City saw house prices fall by 4.2 percent and 3.94 percent respectively. These price changes were achieved through respectable sales volumes:

    • 200 houses in Mornington Peninsula Shire,
    • 136 house sales in Frankston City,
    • 126 sales in Kingston City and
    • 90 sales in Greater Dandenong City.

    Mornigton Peninsula Capital Growth Heatmap for units

    The market for units in Mornington Peninsula Shire has much less volume than the market for houses. For example, the last quarter saw sales of just 15 units in the last quarter compared to the sale of 200 houses. However, the unit market is faring much better than the market for houses, seeing a price increase of 3 percent in the last quarter.

    Frankston City and Casey City to the north have very similar profiles with sales of 24 units and a price increase of 0.69 percent in Frankston City and a price increase of 3.22 percent on the sale of 19 units in Casey City. Kingston City andGreater Dandenong City also avoided price falls, seeing unit prices rise by 0.69 percent and 2.21 percent respectively.

    What are the most in-demand dwelling types?

    Demand for houses and units in Mornington Peninsula Shire both for rent and to buy is at the very top of the national demand spectrum. This shows that property in the LGA is going to be a good bet over the long run because there will always be market activity here.

    Prices in the rental sector closely reflect price activity in the sales sector: rent levels have fallen slightly for houses, but have risen strongly for units. Yields are not doing too well, but they have fallen only slightly in the units sector.

    The demand profile for property sales in Mornington Peninsula Shire shows that 3-bedroomed houses dominate the market. The market for units is smaller than that for houses in every property size category. Four-bedroomed houses and five bedroomed houses are the next biggest sellers in the LGA. Even in the two-bedroom and one-bedroom categories, house sales outstrip the sales of units.

    Property market outlook for houses

    The forecast graph above also displays historical records for both sales and rentals of houses in the Mornington Peninsula Shire LGA. Sales were always higher than rental volumes in every quarter until Q4 2018 when the rising volume of completed rental contracts per quarter overtook the number of sales. Rental volumes have been on a constantly rising trend, reaching a peak of 710 contracts in the last quarter. House sales volumes peaked in Q4 2017 at 960 sales and have been in decline ever since. The sales volume of 200 in the last quarter represents a significant drop since 2017.

    Both house sales prices and rent levels have seen a steadily increasing trend. However, the average house sales price peaked in Q1 to Q3 2018 at A$970,000 and have been falling gently since down to $950,000 in the last two quarters. House rent levels peaked at A$480 in Q1 2018 and have retreated to A$460 in the last quarter.

    HtAG expects house prices to continue to fall down to an average of A$900,000 by Q3 2021. Sales volumes should rise steadily, but they will remain lower than rental volumes per quarter, which HtAG expects will by slightly lower by Q3 2021. Rental levels will fall slightly over the next two years to an average price of A$450.

    Sales prices spurted from 2014, and then flattened, losing the price rise momentum in 2017. This phenomenon is clear in the price change graph above. Price changes have turned negative in 2019. HtAG estimates see price falls up to the end of 2021.

    The heatmap of house price changes of zones within the LGA is very illuminating. Very few districts actually saw price falls in the last quarter even though the LGA in general saw a price fall. Red Hill saw a small price drop of 0.88 percent. However, that was over only two sales. Cape Schanck also had only two sales in the quarter and saw the average sales price fall by 3.18 percent. Portsea had eight sales and a price drop of 5.13 percent. Tyabb, with four sales, saw a price fall of 2.52 percent. In all of these cases, the low sales turnover means that price changes shouldn’t be used as a guide to future movements.

    Suburbs with most houses sold

    Mornington, Mount Eliza, and Mount Martha had much more significant sales levels: and 30, 19, and 25, respectively. Price changes over these volumes offer much better guidance. Mornington experienced a price fall of 1.89 percent. However, Mount Eliza, immediately to the north had a substantial price rise of 10.45 percent. Mount Martha saw a price rise of 5.01 percent. So, the overall price fall figure of 1.71 percent for the LGA gets a lot more interesting at zone level.

    The strongest prices rises were over on the West Port Bay side of the peninsula. Bittern saw a rise of 13.25 percent and neighbouring Crib Point saw the average sales price increase by 11.66 percent. However, these zones had low sales turnover at four house sales in Bittern and five sales in Crib Point.

    The scatter plot above shows where all of the sales activity lies. The Port Philip Bay coastline has a much higher sales activity than the rest of the LGA.

    What is the market outlook for units?

    In Mornington Peninsula Shire there is less demand for units than houses in both the rental and the sales sectors. Units have always been more popular in the rental market than for sale. The superior volume in the rental market has become more pronounced in the past year. As with the market for houses, rental volumes have risen and sales volumes have fallen in the units market.

    Unit sales hit their highest level in Q4 2017 with 120 sales. In the last quarter, only 15 sales occurred. During the same period, unit rentals rose from 200 in Q4 2017 to 270 in the last quarter. Clearly, there is much more interest in units for rent than units for sale in the Mornington Peninsula Shire LGA.

    HtAG forecasts sales volumes of units to recover, but not back up to their peak levels. By Q3 2021, sales volumes should be at 51 units. HtAG expect this improved interest in units will lead to price rises over the next two years. Rental levels should rise as well. However, volumes will fall dramatically in the rental sector.

    The market cycle graph for units is very interesting. The sales market has never seen a price drop and, in fact, annual price increases reached very high levels at the peak of 9.08 percent in 2017. Although price increases were not as dramatic in 2018 and 2019, prices did increase nonetheless.

    Year on Year Growth Rate for Units

    The market cycle graph for Mornington Peninsula Shire is almost unique among all the LGAs in Australia because it shows the unit sales market has never experienced a price fall. HtAG predicts that prices will continue to rise and at an increased rate over the next two years.

    Very few zones within the LGA experienced unit sales in the last quarter. These are represented by coloured areas in the heatmap shown above. Even in those districts that saw sales activity, the volume of unit sales was very low. Although there are areas coloured red, there were no price falls recorded in the LGA during the last quarter. In this map, red signifies a price increase of up to 2 percent.

    Low sales volumes make it difficult to use sales price figures as guidance. Mornington experience the highest sales volume with just seven units sold. The area saw an increase in the average price of units of only 0.13 percent. The highest price increase occurred in Safety Beach, but with just two unit sales.

    Suburb Capital Growth Heatmap for Units

    Overall, the prospects for property investors in the unit market in Mornington Peninsula Shire offers a much stronger guarantee of price rises than the sales market for houses. The only problem with the unit market is that volumes are very low.

    The scatter plot above shows that most of the sales activity for units in the last quarter occurred in coastal areas on the peninsula.

    Conclusion

    Although prices are expected to rise in the unit rental sector over the next two years, rental volumes will fall. A shortage of demand might make seasoned property investors a little cautious of the unit rental market in Mornington Peninsula Shire. However, the sales market for units offers a great Outlook for the Mornington Peninsula Property Market with almost a guaranteed price rise foreseen.

    The market for houses doesn’t carry the same prospects for price rises. In fact, it is certain that house sales prices will fall and so will the rent values of houses in the LGA. Therefore, over the next two years, property investors would be advised to focus on buying and selling units in Mornington Peninsula Shire.

  2. Mornington house rental prices have been growing (YoY) year on year. However, on the same token, Mornington Council has also been experiencing capital growth which means that its overall yield is not substantial enough to provide customer with neutral gearing potential properties (assuming one’s deposit is not bigger than 20%).

    Notwithstanding the fact that neutral gearing if potential out of reach for customers interested in Mornington, the area is still of high investment quality. On of the reason for this are Mornington’s house rental prices which remain steadily growing and in high demand. This is specifically evident in case of its top 5 suburbs based on confidence (Fingal, VIC 3939; Red Hill South, VIC 3937; Baxter, VIC 3911; Balnarring Beach, VIC 3926; Somers, VIC 3927). With vacancies ranging from 3.33% to 2%, the areas in some instances highlight a balanced demand for properties which provides customers with the added security of having the investment property rented out with minimal lags and changeovers. This is also indicated by the fact that HtAG is forecasting an increase in rentals across the aforementioned areas which signals demand.

    Having your property rented out for the duration of the investment period with minor vacancy period provides you with an added security to focus on leveraging your capital growth and earning into additional properties. Reduced cost of holding the property (i.e. low vacancy rate) also permits for maintaining the same lifestyle as the customer is not required to dip more into his/her savings to keep the property and wait for the capital growth. Overall, given that the rents are increasing and that mots of the top 5 areas are positioned for medium to high capital growth, Mornington keeps its investment potential.

    If I had to pick an area from Mornington to invest in, it would be Baxter, VIC 3911. Why? Well, it has low vacancy rate, low entry point compared to other suburbs in Mornington (typical price at 664k) and it is forecasting between 12-18% growth (average per annum) meaning the projection error rate is very small (2.91%). I would also purchase a 3 bedroom house since this property type is in highest demand in Baxter.

    Happy investing…

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